Crypto World
why the macro trade stopped working
For the third consecutive month, a major inflation print failed to move Bitcoin in either direction. The asset that was supposed to trade on rate cut expectations is trading on something else entirely, and the market has not yet agreed on what that something is.
Summary
- The July CPI report landed at 3.4% year over year and 0.1% month over month on August 12, exactly matching consensus. Bitcoin moved from $63,800 to $64,100 over four hours, a 0.47% change on a data point that used to produce 5% to 10% swings.
- Bitcoin’s correlation with the Global Easing Breadth Index, which tracks monetary policy across 41 central banks, has inverted from +0.21 before the spot ETF approval in January 2024 to negative 0.778 in 2026, nearly three times stronger in the opposite direction.
- Perpetual futures trading activity sank to a three year low ahead of the August 12 release, and options markets priced only 1.3% expected movement, signaling that traders had stopped treating CPI as a catalyst before the number was even released.
- Strategy’s seven week buying hiatus and $108.6 million Bitcoin sale on August 10 have removed the reflexive bid that previously amplified macro catalysts. The company that bought Bitcoin on every dip is now selling on every rally, inverting the feedback loop that connected monetary policy expectations to Bitcoin price.
- Bitcoin ETF flows have decoupled from macro data: spot Bitcoin ETFs posted $854 million in weekly inflows during the first week of August despite no change in Fed rate expectations, suggesting the ETF bid now operates on its own schedule, independent of inflation prints.
Bitcoin’s price on August 11, the day before the CPI report, was $63,890. Bitcoin’s price on August 12, after the CPI report showed inflation at 3.4% with core at 2.5%, was $64,100. The difference was $210, or 0.33%.
That number deserves context. In the 18 months after spot Bitcoin ETFs launched, CPI day was the most important date on the crypto calendar. Traders cleared their books beforehand. Options desks priced CPI-week volatility premiums of 15% to 25% above baseline. Crypto media ran countdown clocks. The Bureau of Labor Statistics release at 8:30 a.m. Eastern was treated as a binary event that would determine whether Bitcoin rallied or crashed.
In December 2024, when CPI came in at 3.1%, Bitcoin moved 7% in four hours. In March 2025, when core CPI surprised to the downside at 2.8%, Bitcoin rallied 11% over two sessions. In June 2025, when inflation spiked to 4.2% on tariff pass-through effects, Bitcoin fell 9% in a single trading day. These were not outliers. They were the norm. CPI day was, reliably, the highest volume and highest volatility day of each month for Bitcoin.
The August 12 non-reaction was not an anomaly. It was the third consecutive month in which a major U.S. inflation print produced less than 1% movement in Bitcoin’s price. The June CPI, which showed inflation dropping from 4.2% to 3.5%, moved Bitcoin approximately 0.8%. The July 14 print, which came in below expectations at 3.5%, produced a 4.4% rally to $65,000 that reversed entirely within 48 hours. The pattern is consistent: Bitcoin has stopped responding to the data that, for two years, was the single most important driver of its price. The transformation is visible not just in price action but in market microstructure. CPI-day options premiums on Deribit have declined from 25% above baseline in early 2025 to less than 5% above baseline in August 2026. The market is not just failing to move on CPI. It has stopped expecting to move on CPI, and it has priced that expectation into the derivatives structure.
The correlation that broke
The relationship between Bitcoin and monetary policy expectations was, until recently, the dominant framework for institutional crypto allocation. The thesis was straightforward: Bitcoin benefits from loose monetary policy because lower rates reduce the opportunity cost of holding a non-yielding asset, increase risk appetite, and weaken the dollar. When CPI came in low, rate cut expectations rose, and Bitcoin rallied. When CPI came in high, rate cut expectations fell, and Bitcoin sold off.
Binance Research published a case study in June 2026 documenting the structural inversion. Bitcoin’s correlation with the Global Easing Breadth Index, which measures the net percentage of central banks cutting rates across 41 economies, had been positive through 2023 and 2024. By mid-2026, the correlation had flipped to negative 0.778. Bitcoin was no longer moving in the same direction as monetary easing expectations. It was moving in the opposite direction, or not moving at all.
The inversion is not subtle. A correlation of negative 0.778 is nearly three times stronger than the positive 0.21 correlation that prevailed before the spot ETF launch. The implication is that the macro trade has not merely weakened. It has structurally reversed, and the institutional models built on the old correlation are generating signals that no longer correspond to price action.
The VaaSBlock analysis of the break identified several contributing factors. The BNP Paribas forecast of three rate hikes beginning in December 2026, reversing the three cuts delivered in 2025, should have been catastrophic for Bitcoin under the old framework. Instead, Bitcoin traded between $60,000 and $65,000 throughout the forecast period, largely indifferent to the most hawkish institutional rate call since 2023.
The indifference extends beyond CPI to other macro data points. Nonfarm payrolls in July came in weak, at 114,000 versus 175,000 expected, and Bitcoin moved less than 1%. The 10 year Treasury yield climbed to 4.5% in May, its highest level since May 2025, and Bitcoin held steady near $64,000. The U.S. Treasury intervened in foreign exchange markets in late July, selling euros to buy Japanese yen in a move that would have generated significant cross-asset volatility in previous cycles. Bitcoin barely registered the event. The pattern is comprehensive: not just CPI, but the entire macro data suite has lost its grip on Bitcoin’s price.
Why Bitcoin ignored 3.4%
The specific mechanics of the August 12 non-reaction reveal how thoroughly the macro trade has decomposed.
The July CPI report showed headline inflation at 3.4% year over year, down from 3.5% in June. Core CPI came in at 2.5%, down from 2.6%. Both numbers matched consensus expectations exactly. The shelter index, which accounts for roughly two thirds of the monthly all items increase, rose 0.1%. Energy prices were flat. Food prices rose 0.2%.
Under the old framework, an in-line print would have been modestly positive for Bitcoin. Inflation cooling toward the Fed’s target without surprising to the downside keeps rate cut expectations alive without triggering concern about economic weakness. The expected response was a 1% to 2% rally, consistent with the historical pattern where in-line prints produced smaller but reliably positive moves while surprise prints produced larger directional swings.
Instead, Bitcoin dipped briefly below $64,000 before recovering to $64,100. The four hour candle that contained the CPI release was the narrowest CPI-day candle since spot Bitcoin ETFs began trading. Volume on major exchanges was 35% below the 30 day average. The futures basis on CME, which typically spikes around macro events as traders position for volatility, remained flat at 4.2% annualized, barely above the risk-free rate. By every measurable standard, the market treated the most important monthly data release in macroeconomics as a non-event. Analysts at The Block described the print as one that “buys the Fed time, not conviction.” Polymarket data showed traders assigning 67% probability to no change at the September meeting and 34% probability of a 25 basis point increase. The CPI data did not resolve the uncertainty. It merely extended it.
The muted response was partially mechanical. Perpetual futures trading activity had sunk to a three year low ahead of the release. Options markets had priced expected movement of only 1.3% for Bitcoin, compared to 4% to 6% expected movement during comparable releases in 2024 and early 2025. The market was not surprised by the non-reaction because it had already priced in a non-reaction. The question is why.
The three pillars of the old trade
To understand why the macro trade broke, you have to understand what held it together. Three mechanisms connected CPI data to Bitcoin price through 2024 and into 2025.
The first was the rate cut narrative. From the fourth quarter of 2023 through the third quarter of 2025, the dominant institutional thesis was that the Federal Reserve would cut rates multiple times, reducing the opportunity cost of holding Bitcoin and increasing risk appetite across speculative assets. Every CPI print was evaluated through the lens of its impact on rate cut timing. Lower inflation meant earlier cuts. Earlier cuts meant higher Bitcoin.
The narrative worked until it did not. The Fed delivered three cuts in 2025, totaling 75 basis points. Bitcoin peaked at $126,080 in October 2025 and then declined 50% over the following seven months despite the cuts already being priced in. The rate cuts came, and Bitcoin fell anyway. The falsification of the core thesis, that rate cuts equal higher Bitcoin, undermined the framework for every subsequent macro trade.
The second pillar was the reflexive bid from Strategy, formerly MicroStrategy. For four years, the company bought Bitcoin on every meaningful dip, creating a floor under the price that amplified macro catalysts. When CPI came in soft and Bitcoin rallied, Strategy bought more, extending the rally. When CPI came in hot and Bitcoin dipped, Strategy bought the dip, limiting the downside. The feedback loop meant that macro data did not just move Bitcoin directly. It triggered a corporate buyer whose purchases moved Bitcoin further.
That loop is now running in reverse. Strategy posted an $8.2 billion loss tied to Bitcoin’s price decline and sold approximately $218 million in Bitcoin to cover preferred stock dividends. On August 10, the company sold another $108.6 million in Bitcoin, its seventh consecutive week without a purchase. The entity that provided the reflexive bid on macro catalysts is now providing reflexive selling pressure, and the absence of that bid changes how every macro data point transmits to price.
The third pillar was the ETF flow mechanism. In 2024 and early 2025, CPI data moved Bitcoin price, which moved ETF flows, which moved Bitcoin price further. Good macro data triggered inflows. Inflows required authorized participants to buy Bitcoin on the open market. The purchases pushed the price higher, generating positive returns that attracted more inflows. The virtuous cycle connected a Bureau of Labor Statistics release in Washington to billions of dollars in Bitcoin demand.
The cycle broke in the second quarter of 2026. Bitcoin ETFs recorded $5.4 billion in net outflows during the first half of the year despite three months of improving inflation data. The mechanical link between macro sentiment and ETF flows severed when the price decline overwhelmed the macro signal. Investors were selling their ETF positions not because they expected tighter monetary policy, but because they were underwater and wanted out. The average cost basis for spot Bitcoin ETF buyers who entered in Q4 2024 and Q1 2025 was approximately $85,000 to $95,000, well above the sub-$65,000 trading range that persisted through summer 2026. At a 30% to 40% loss, the decision to sell was driven by portfolio pain, not by any particular inflation number.
The reflexive cycle that connected CPI to ETF flows to price has been replaced by a simpler dynamic: ETF flows now follow price trends, not macro data. When Bitcoin trends higher, inflows accelerate. When it trends lower, outflows accelerate. The August ETF inflows of $854 million coincided with a modest Bitcoin rally from $60,000 to $65,000, not with any specific macro improvement. The cause and effect relationship has reversed. Macro data used to drive price, which drove flows. Now price drives flows, and macro data is largely irrelevant to both.
What replaced the macro bid
If Bitcoin is no longer trading on CPI data, what is it trading on? The evidence suggests three alternative demand drivers that have partially replaced the macro thesis.
The first is structural ETF demand that operates independently of macro data. In the first week of August, spot Bitcoin ETFs posted $854 million in weekly inflows, their strongest week since mid-April. BlackRock’s IBIT alone attracted $694 million. These flows occurred without any change in Fed rate expectations. The ETF bid appears to have developed its own momentum, driven by advisor allocation cycles, model portfolio rebalancing, and institutional mandates that operate on quarterly timelines disconnected from monthly inflation prints.
The second is emerging market demand that is rate-insensitive. Standard Chartered and other analysts have identified a growing share of Bitcoin demand coming from emerging markets where the investment case is currency debasement, not rate arbitrage. In countries with double digit inflation, persistent capital controls, or unstable banking systems, Bitcoin’s value proposition has nothing to do with the Fed funds rate. This demand component is structurally insensitive to U.S. macro data.
The third is supply dynamics that override demand signals. The Bitcoin halving in April 2024 reduced new issuance to 3.125 BTC per block. The cumulative effect of four halvings has reduced annual new supply to approximately 164,000 BTC, worth roughly $10.5 billion at current prices. That supply reduction acts as a constant structural bid that does not fluctuate with CPI releases. Meanwhile, approximately 70% of all Bitcoin has not moved in more than a year, suggesting that the available float is thinner than the total market capitalization implies. On-chain analysts estimate that fewer than 4 million BTC are actively traded, meaning the effective market capitalization that responds to new information is closer to $256 billion than the headline $1.28 trillion figure.
None of these demand drivers respond to CPI data. The composition of Bitcoin demand has fundamentally changed since the spot ETFs launched in January 2024. Before the ETFs, the marginal buyer was typically a crypto-native trader using leveraged perpetual futures on offshore exchanges. That buyer watched CPI obsessively because the Fed funds rate directly affected the funding rate on their positions. After the ETFs, the marginal buyer is increasingly a wealth management client whose advisor allocated 1% to 3% of a diversified portfolio to IBIT on a quarterly rebalancing schedule. That buyer does not watch CPI at all.
The shift in marginal buyer composition explains the correlation break more completely than any single macro variable. When the marginal buyer does not care about CPI, CPI cannot move the price, regardless of what the number says. The market has shifted from a regime where the marginal buyer cared about the Fed to a regime where the marginal buyer does not, and the transition happened gradually enough that many institutional models have not yet updated.
The opposing case: why the macro trade could return
The strongest version of the counter argument is that the correlation break is temporary, not structural.
Bitcoin’s price has been range-bound between $60,000 and $65,000 for most of the summer. Range-bound markets produce low correlations with everything because there is not enough price movement to correlate with. The macro trade may not be broken. It may be dormant, waiting for a catalyst large enough to overcome the current equilibrium between ETF inflows, Strategy selling, and miner supply.
That catalyst could be a rate hike. If the Federal Reserve raises rates at its September meeting, as the 34% Polymarket probability suggests, Bitcoin would face its first rate increase since the spot ETFs launched. No existing model can predict how $55 billion in ETF assets would respond to a hiking cycle. The advisor allocation models that drove inflows through 2024 and 2025 were built on an assumption of stable or declining rates. A hiking cycle could trigger systematic rebalancing out of crypto allocations, producing the kind of violent macro-driven move that the last three CPI prints failed to generate.
The June 2026 episode offers a partial preview. When crypto-specific factors, including leverage unwinding and ETF outflows, caused Bitcoin to drop from $68,000 to below $57,000 in 72 hours, the S&P 500 remained near record highs. The crash had nothing to do with macro data. But the recovery was shaped by it: Bitcoin stabilized near $60,000, precisely the level where the ETF cost basis cluster suggested institutional buyers would step in. The macro trade may have broken for CPI data, but the structural floor created by ETF cost bases introduces a new form of macro sensitivity that operates through portfolio allocation mechanics, not rate expectations.
There is also the possibility that Bitcoin’s apparent indifference to CPI data masks a lag rather than a permanent decoupling. CPI feeds into dot plot expectations. Dot plot expectations move real yields. Real yields move the dollar. The dollar moves Bitcoin. The transmission mechanism has more steps than a simple CPI-to-Bitcoin relationship, and each step introduces a delay. It is possible that the August 12 CPI data will eventually affect Bitcoin’s price, but through channels that operate on a weeks long timeline rather than an intraday one.
The BTC/S&P 500 correlation, which climbed from roughly 0.1 to 0.2 in earlier periods to approximately 0.6 to 0.8 during macro-driven phases, suggests that Bitcoin has not decoupled from macro entirely. It has decoupled from CPI specifically while remaining sensitive to equity market movements that are themselves driven by macro factors. The decoupling may be narrower than it appears.
What to watch
September 16 FOMC decision. If the Fed hikes for the first time since the ETFs launched, Bitcoin’s response will test whether the macro trade is truly dead or merely hibernating. A 5% or larger move would suggest the correlation is intact for large events. A sub-1% move would confirm the break.
Strategy’s buying resumption. The company said it will not resume Bitcoin purchases until STRC preferred stock recovers toward its $100 par value from its current $90.60. A resumption of buying would restore the reflexive bid that amplified macro catalysts through 2024 and 2025.
ETF flow sensitivity to macro data. Watch whether weekly ETF flow data begins correlating with CPI and jobs reports again. If ETF flows respond to macro data even when Bitcoin’s spot price does not, the macro trade may be transmitting through a new channel.
Perpetual futures open interest. Trading activity hit a three year low before the August 12 print. A return of speculative positioning around macro events would indicate that traders are re-engaging with the macro framework.
Bitcoin’s response to PPI. The Producer Price Index release follows CPI closely. If Bitcoin responds to PPI after ignoring CPI, the market may be shifting its attention to different inflation indicators instead of abandoning the macro trade entirely.
What happened to Bitcoin after the August CPI report?
Bitcoin moved from approximately $63,800 to $64,100 after the July CPI report landed at 3.4% year over year on August 12, 2026. The 0.33% change was the smallest CPI day response since spot Bitcoin ETFs launched in January 2024 and the third consecutive month of sub-1% responses to major inflation prints.
Why did Bitcoin stop reacting to CPI?
The macro correlation broke down for three reasons: the rate cut narrative was falsified when Bitcoin fell 50% after the Fed delivered three cuts in 2025, Strategy’s shift from buyer to seller removed the reflexive bid that amplified macro signals, and the ETF flow mechanism severed when investors sold positions regardless of improving inflation data.
What is the Bitcoin macro correlation?
Bitcoin’s correlation with the Global Easing Breadth Index, tracking monetary policy across 41 central banks, was positive 0.21 before the spot ETF launch in January 2024 and inverted to negative 0.778 by mid-2026. This means Bitcoin and global monetary easing now move in opposite directions.
Is Bitcoin decoupling from the Federal Reserve?
Bitcoin appears to be decoupling from CPI specifically while maintaining some sensitivity to broader equity market movements. The BTC/S&P 500 correlation remains between 0.6 and 0.8 during macro-driven phases, suggesting a narrower decoupling from inflation data rather than a complete separation from macro factors.
What replaced the macro bid for Bitcoin?
Three alternative demand drivers have partially replaced the macro thesis: structural ETF demand on advisor allocation cycles ($854 million weekly in early August), emerging market demand that is insensitive to U.S. rates, and supply dynamics from the April 2024 halving that reduce annual new issuance to approximately 164,000 BTC.
How did Strategy change the macro trade?
Strategy provided a reflexive bid on every Bitcoin dip for four years, amplifying macro catalysts. The company’s shift to a net seller, with $108.6 million in Bitcoin sales on August 10 and no purchases for seven weeks, removed that amplification mechanism and inverted the feedback loop.
Will Bitcoin respond to a rate hike?
If the Federal Reserve hikes rates at the September 16 meeting, as the 34% Polymarket probability suggests, it would be the first hike since spot Bitcoin ETFs launched. No model can predict how $55 billion in ETF assets would respond, making it the most significant test of whether the macro trade is dead or dormant.
What should traders watch for the Bitcoin macro trade?
The September FOMC decision, Strategy’s potential return to buying, ETF flow sensitivity to macro data, perpetual futures open interest recovery, and Bitcoin’s response to PPI versus CPI data are the five indicators that will determine whether the macro correlation is permanently broken or temporarily dormant. This is analysis, not trading advice.
Disclosure: This article is for informational purposes only and does not constitute financial or investment advice. Correlation data is sourced from Binance Research and VaaSBlock. Prices and macro data are current as of August 12, 2026.
StablecoinX shares have climbed more than 12% after the Nasdaq-listed company disclosed a 3-billion-token ENA treasury and reported its first quarterly results since going public.
Summary
- StablecoinX held approximately 3 billion ENA tokens, equal to about 20% of the total supply.
- The ENA treasury was valued at $218.4 million, or about $9.09 per Class A share.
- StablecoinX recorded a $34.2 million quarterly net loss, largely caused by a non-cash impairment charge.
- Infrastructure services produced $62,372 in revenue during the final two weeks of June.
StablecoinX values its ENA treasury at $218.4 million
StablecoinX said in its Aug. 14 quarterly results release that its ENA treasury totaled approximately 3 billion tokens at the end of the second quarter, giving the company control of roughly 20% of ENA’s 15 billion-token supply.
Using ENA’s June 30 closing price of $0.07204, StablecoinX valued the position at $218.4 million. The treasury was worth approximately $9.09 for each of the 24,029,375 Class A shares outstanding on that date, according to the company.
Around 284.95 million ENA tokens came from the Ethena Foundation as part of StablecoinX’s business combination. Cash and in-kind investments made by private investment in public equity participants accounted for another 2.75 billion tokens.
StablecoinX reported total assets of $232.6 million at quarter-end, including $18.9 million in cash and cash equivalents. Its balance sheet carried $212.9 million in digital intangible assets, consisting mainly of ENA recorded at cost after impairment.
Shares rose more than 12% during early U.S. trading on Friday following the results. The stock reaction came less than two months after StablecoinX completed its merger with special-purpose acquisition company TLGY Acquisition Corp.
As crypto.news reported in June, the business combination closed on June 25, with StablecoinX’s Class A shares and public warrants starting Nasdaq trading one day later under the symbols USDE and USDEW.
A non-cash ENA charge drove the quarterly loss
For the three months ended June 30, StablecoinX recorded a net loss of $34.2 million, equal to $15.27 per share. Most of the loss came from a $36.2 million impairment charge tied to its digital intangible assets rather than spending by its operating business.
After excluding the impairment and changes in the value of digital asset-related instruments and warrant liabilities, the company calculated an adjusted non-GAAP net loss of $188,204. StablecoinX had used $81,680 in cash for operating activities during the first six months of 2026.
Revenue remained limited because the company’s infrastructure operation only began producing income near the end of the reporting period. StablecoinX generated $62,372 from infrastructure services during the final two weeks of June, with no revenue reported from its other planned business lines.
Chief Executive Edward Chen described the quarter as StablecoinX’s first reporting period as a public company and said the completed merger had opened a stock-market route into yield-bearing digital dollar products.
“Our first quarter end as a public company reflects the successful close of our business combination.”
The company’s ENA position leaves its asset value and reported results closely tied to the market price of Ethena’s governance token. StablecoinX also identified ENA volatility, changing regulatory conditions, and difficulties launching its planned products as risks that could affect its financial performance.
For U.S. investors, StablecoinX provides exposure through Nasdaq-listed shares rather than requiring the direct purchase or custody of ENA. Its public status also requires the company to disclose financial results and material developments through filings with the U.S. Securities and Exchange Commission.
Infrastructure services have processed $3 billion
Beyond the token treasury, StablecoinX operates a decentralized verifier node that checks and delivers cross-chain messages for Ethena products. The company said the node had verified more than 10,000 messages and surpassed $3 billion in cumulative cross-chain volume as of Aug. 12.
Every message verified by the node had been delivered successfully, according to StablecoinX. Fees from the infrastructure service are based on processed volume rather than the number of individual transactions.
During July, the company began rolling out a second business line through its StablecoinX Harness middleware platform. The initial phase launched on July 2, and StablecoinX signed its first Harness client eight days later.
Harness is designed as a single application programming interface through which companies can access payment routing, cross-chain bridging, liquidity, treasury management, and institutional reporting tools. StablecoinX also opened applications for a design partner program covering payments and agents, blockchain networks and protocols, and institutional users.
A third business line, Distribution Services, is planned for 2027, subject to market and regulatory conditions. StablecoinX said the service would give investors indirect access to USDe and could generate distribution and management fees from deployed capital.
Ethena has expanded institutional access to USDe
StablecoinX’s original treasury plan began with a $360 million PIPE financing announced in July 2025. A further $530 million round disclosed in September brought committed PIPE funding to approximately $890 million, with YZi Labs, Brevan Howard, Susquehanna Crypto, and IMC Trading among the participants.
The financing agreements called for part of the proceeds to purchase locked ENA at a discount from an Ethena Foundation subsidiary. StablecoinX also entered a long-term collaboration agreement that allows it to acquire additional tokens directly from Ethena under agreed terms.
While the treasury gives StablecoinX a large position in Ethena’s governance system, its operating plan depends on demand for USDe and other products connected to the protocol. USDe uses crypto assets, hedged derivative positions, and other backing arrangements to maintain its target value, while holders of its staked form, sUSDe, can receive rewards.
By July 31, USDe supply had settled at approximately $3.9 billion, according to StablecoinX. The protocol’s backing ratio stood near 101.7%, while the annual percentage yield on sUSDe increased from 3.8% to 4.1% during July. Ethena has generated more than $800 million in cumulative protocol fees and distributed over $750 million in ecosystem rewards since its launch.
Institutional distribution has continued despite the decline from USDe’s previous supply peak. In June, BlackRock integrated USDe into Aladdin, allowing financial institutions using its investment management platform to access the synthetic dollar through existing portfolio and risk systems.
Coinbase also introduced an Ethena-powered lending vault in June. The product lets users lend USDC through Morpho markets while Ethena-related assets form part of the vault’s collateral structure.
Ethena has since added FalconX to an institutional lending program that already included agreements with Anchorage Digital, Maple Institutional, and Coinbase Asset Management. Ethena’s June governance report placed institutional lending at approximately $310 million, or 6.9% of USDe’s backing portfolio.
Crypto World
Polymarket CLARITY Act Odds Crashed From 82% to Under 20%, Does September 15 Save the Bill?
Polymarket CLARITY Act odds being signed into law this year fell below 20% early this week. The decline followed months of uncertainty over whether the Senate can advance the crypto market-structure legislation.
Discover: Everyone’s Got a Take. Get Free $25 to Actually Trade Yours
Polymarket CLARITY Act Odds: The Recess That Reset The Clock
The Senate adjourned for its August recess without a vote on the bill. Before lawmakers left town, Senate Majority Leader Thune scheduled a vote for September 15, American Banker reported.
American Banker described September 30 as the last clear deadline before Congress turns more fully toward campaigns and partisanship.
JUST IN: — Bitcoin Magazine (@BitcoinMagazine) July 29, 2026
American Bankers Association CEO tells CNBC "There's a lot of good in the Clarity Act" 
"I do think that the crypto and the banking sectors can coexist. I think we can be the crypto capital of the world."
"We're working with the Senators" on this bill. pic.twitter.com/3SldlEBEOS
The scheduled September vote keeps the bill in play, but negotiations over its remaining provisions have yet to produce a final outcome.
Discover: Your Market Calls Are Worth Something. Start With Free $25 on Kalshi
What Moved The Odds
Polymarket traders gave the bill a 20% chance of passing by year-end, down from a high of 82% on February 19.
The odds had declined since early May as the Senate calendar narrowed and lawmakers faced questions about assembling bipartisan support.
Senate negotiations have remained focused on unresolved ethics provisions. CoinDesk described the absence of bipartisan ethics language as one of the bill’s largest obstacles, while American Banker noted that a merged text combining the Banking and Agriculture Committee versions had recently been released.
What the Bill is Designed to Address
If enacted, the Clarity Act would establish a federal framework for digital-asset markets and draw a clearer line between assets regulated by the Securities and Exchange Commission and those overseen by the Commodity Futures Trading Commission.
Supporters of the measure argue that clearer statutory rules would reduce regulatory uncertainty and bring crypto activity onshore. They have also argued that legislation would provide durable rules rather than leaving the industry to operate under agency guidance.
The September 15 vote is the next scheduled milestone for the legislation. American Banker argued that September 30 is the last clear deadline before campaign considerations make further movement more difficult.
For now, the sub-20% Polymarket reading reflects skepticism about whether the Senate can resolve the outstanding issues and move the bill forward this year. The bill’s House passage, Senate committee approval and scheduled September vote show that the legislation remains active, but its unresolved ethics provisions continue to weigh on its prospects.
Don’t Miss Out on Our $1,000 USDT Airdrop on ByBit
The post Polymarket CLARITY Act Odds Crashed From 82% to Under 20%, Does September 15 Save the Bill? appeared first on Cryptonews.
Israel’s Bank Leumi has partnered with Galaxy Digital to let customers trade Bitcoin (BTC), Ether (ETH), and Solana (SOL) through the bank’s investment platform, with the service expected to launch in early 2027.
The companies said Friday that customers of Leumi and Pepper, its mobile banking arm, will be able to buy, hold and sell the three cryptocurrencies through a dedicated section of the Leumi Trade app. Leumi and Galaxy said the rollout would make Leumi the first Israeli bank to offer digital asset trading services to customers.
Leumi will use GalaxyOne Institutional for trading and related services, while Galaxy’s custody infrastructure platform, formerly known as GK8, will support the bank’s digital asset infrastructure.
According to Leumi, the bank serves millions of customers across its retail and business operations.
The partnership comes after Galaxy reported an $85 million net loss in the second quarter, which it attributed largely to declining digital asset prices. Despite the loss, its digital assets business generated $66 million in adjusted gross profit, up 34% from the previous quarter.
Galaxy Digital, founded and led by Mike Novogratz, began trading on the Nasdaq under the ticker GLXY in May 2025. Its shares were trading at $21.38 on Friday morning, up about 2% on the day but down roughly 25% over the past year, according to Yahoo Finance data.
Magazine: Solana’s fee overhaul increases burn and makes resource hogs pay
XRP price slipped below $1 again in the past 24 hours, despite record adoption metrics across the XRP Ledger (XRPL). The altcoin is currently testing a level it defended for years.
The breakdown complicates a thesis built almost entirely on institutional demand and network growth.
What the Price Action Actually Shows
A psychological support level is a round number that traders defend collectively, often regardless of underlying fundamentals. XRP has held above $1 for 635 consecutive days.
The streak ended on August 11. The token printed $0.9915, its first move below the level since November 2024. Each return to that zone carries weight. Repeated tests suggest sellers keep probing for weakness beneath a floor that once looked solid.
The symbolism cut deeper than the arithmetic. At the recent low, XRP briefly traded below RLUSD, Ripple’s own dollar stablecoin. Technical levels now define the range.
Analysts identify $0.70 to $0.90 as the next support, with a broader zone extending toward $0.86 if selling accelerates.
Follow us on X to get the latest news as it happens.
Reclaiming ground requires specific progress. Buyers would need to push above $1.03 to meaningfully improve the short-term structure.
Fund flows offer little encouragement. Spot product net inflows totaled $3.27 million so far in August, down roughly 88% from the $27.29 million recorded in July, according to SoSoValue data.
The Case Analysts Keep Defending
Some analysts point elsewhere entirely. The monthly relative strength index reached its most extreme reading in twelve years, deeper than the pandemic crash or the 2018 bear market.
Institutional adoption anchors their case. Aviva Investors, which manages $351 billion, launched a tokenized fund on the XRP Ledger with approval from the Central Bank of Ireland.
Ecosystem metrics reinforce that argument. Real-World Assets value on the XRPL sits near $4.06 billion, after adding roughly $2.5 billion over six months.
“…The bears say the ledger can succeed without the token capturing value. The bulls say the settlement layer of the bridge currency function create structural demand that grows with adoption. Both arguments have merit. The honest answer is that the token network relationship is genuinely unresolved and at historic RSI lows with institutional adoption accelerating the riskreward for being wrong on the bearish side is significant…,” Lark Davis said.
On-chain data shows accumulation, too. Santiment recorded 32 new wallets holding at least 1 million XRP over three months, though single entities can control multiple addresses.
One structural detail complicates the thesis considerably. Ripple’s ten major institutional deals during 2026 all settled in RLUSD rather than XRP. That fact anchors the bearish case. The XRPL can grow commercially while the token captures little of that activity, since institutions need infrastructure rather than the asset.
Analyst targets diverge accordingly. Standard Chartered maintains $2.80 while analyst Ali Martinez flags downside risk toward $0.62. History provides an uncomfortable reference.
XRP lost 95%of its value in the two years following its 2018 peak, and it currently trades roughly 72.5% below its July 2025 record, according to BeInCrypto data.
The disconnect defines everything now. Adoption data shows where infrastructure gets built, not whether holders eventually see that value reflected in price.
Subscribe to our YouTube channel to watch leaders and journalists provide expert insights.
The post XRP Price Falls Below $1 Again Despite Record Network Adoption appeared first on BeInCrypto.
China’s central bank injected a net 348 billion yuan, about $51.7 billion, into its banking system on Friday. Bitcoin (BTC) fell 1.7% anyway.
It was the first mid-month use of overnight reverse repos by the People’s Bank of China (PBOC), according to Bloomberg. Three more injection days are already booked, each capped near $88 billion.
Beijing Already Booked Three More Injection Days
Start with what the tool actually does. An overnight reverse repo is a one-day loan from the central bank to commercial banks. The banks repay it the next morning.
Two days before Friday, the PBOC published its schedule. It would lend on August 14, then again from August 17 through August 19, local media reported.
Each day carries a ceiling of 600 billion yuan, close to $88 billion. Friday used only 58% of that room.
Add up all four days and the ceiling reaches 2.4 trillion yuan. That is a liquidity corridor, not a one-off gesture.
The corridor exists because Beijing has stopped cutting rates. The PBOC has held its one-year benchmark lending rate at a record low 3% since May 2025. Plumbing has replaced rate cuts.
China’s Bond Market Broke Ranks With Everyone Else
Domestic bonds moved first. China’s 10-year government bond yield slipped to 1.68%, its lowest since July 2025. A government bond auction the same day drew the weakest 10-year yields in over a year.
Now compare that with the United States. The 10-year Treasury yield sat near 4.63%. The gap between the two is roughly 295 basis points.
Japan’s 10-year yield closed at 2.87% on Thursday, still near multi-year highs. Bitcoin trades against that global cost of money, not China’s.
Rising Western borrowing costs have squeezed risk assets all year. The highest 30-year Treasury yield since 2007 arrived in July. Bitcoin has traded heavily since.
Currency stress added to the strain. Traders watched yen intervention fade again this month, and global funding stayed tight.
Whether Any of This Cash Reaches Bitcoin
There is now a precedent worth checking. The PBOC launched this tool on June 29 with 300 billion yuan, about $44 billion. Bitcoin fell then too. BTC dropped 2.26% to $58,504 by the following morning, according to Fortune data.
Two injections, two declines. The sample is small, but it is the only direct evidence available.
The longer view reads differently. Bitcoin has gained roughly 7% since that June operation. Slow drift, not injection-day pops.
Analysts describe Friday as tuning rather than easing. Mid-month tax bills drain cash from banks, and the PBOC refilled the hole.
“The stance toward liquidity management appears unchanged, in that the PBOC aims to smooth liquidity but not overflood the market,” said Frances Cheung, head of foreign exchange and rates strategy at Oversea-Chinese Banking Corp., in published remarks.
Capital controls are the harder barrier. Chinese banks cannot send reserves to offshore crypto markets. Domestic trading stays banned.
Any effect on Bitcoin therefore arrives indirectly, through mood and currency markets. Crypto has leaned on that hope before. Last November, central banks flooded markets on both sides of the Pacific, and bulls read it as a starting gun.
Still, calmer funding costs matter to leveraged traders.
“The better-anchored market repo rates, with likely lessened volatility of overnight funding costs ahead, could lift conviction in carry trades in the near term,” Jeffrey Zhang, strategist at Credit Agricole CIB, in the same report.
Carry trades borrow cheap money in one currency to buy assets elsewhere, including Bitcoin near $62,800. Steadier overnight rates in China trim one cost in that chain.
Monday brings July activity data and the next injection window. China grew 4.3% in the second quarter, its weakest pace since late 2022. July consumer prices also missed forecasts.
Friday delivered the cash and Bitcoin still dropped. If Chinese liquidity can move global risk appetite, Aug. 17 through Aug. 19 should prove it.
The post China Injected $52 Billion and Bitcoin Fell, Three More Days Are Scheduled appeared first on BeInCrypto.
Metaplanet CEO Simon Gerovich has publicly denied speculation that the treasury company was selling its Bitcoin holdings after a routine transfer sent rumor mills into overdrive.
Gerovich clarified that the Bitcoin treasury company moved 5,014 BTC, worth around $320 million, between its custodial wallets, not to an exchange.
Metaplanet Shuts Down Bitcoin Sale Speculations
Gerovich confirmed the Bitcoin treasury company’s Bitcoin holdings remain unchanged after blockchain trackers spotted a transfer from wallets linked to the company. The transfer fueled speculation that Metaplanet was following Strategy’s lead and cashing out on some of its holdings. However, Gerovich moved quickly to calm speculation, stating that it was a routine transfer between company wallets.
“We transferred 5,014 BTC between Metaplanet custodial addresses over the past 24 hours. This was a routine custody operation. No bitcoin was sold, and our holdings remain 43,000 BTC. All of our addresses are published, which is why the transfers were observable in real time. Total network fees to move $322 million in bitcoin: approximately $8.”
Metaplanet’s wallet addresses are public, allowing anyone to view transfers on-chain. However, the company’s commitment to transparency around its holdings briefly worked against it, setting off alarm bells in the community. Metaplanet currently holds 43,000 BTC, worth around $3 billion at current prices. With BTC’s steep decline, the company is sitting on an unrealized loss of around $1.4 billion, according to data from Arkham Intelligence.
Recent Strategy Sales Increase Scrutiny On Bitcoin Treasury Companies
Strategy’s recent Bitcoin sales have soured market sentiment and increased scrutiny of Bitcoin treasuries. This is why Metaplanet’s routine transfer created significant speculation about an imminent sale, with investors assuming it is following Strategy’s footsteps. Strategy, the largest corporate holder of Bitcoin, has been strategically selling BTC to fund dividend obligations on its preferred STRC stock and buy back STRC. It is also selling MSTR to fund its dollar reserve.
Future Bitcoin Acquisitions
Metaplanet’s Bitcoin stash has grown steadily in 2026, despite a substantial decline in BTC’s price. The company added 5,075 BTC during Q1 2026, followed by a 2,823 BTC purchase in Q2, taking its total stash to 43,000 BTC. Metaplanet is the third-largest Bitcoin treasury company in the world and the largest in Asia. It plans to increase its Bitcoin holdings to 100,000 BTC by the end of 2026 and 210,000 BTC by the end of 2027.
The Bitcoin treasury company has also launched BitBonds, a fixed-rate debt program to fund future Bitcoin acquisitions and other corporate obligations. The program allows Metaplanet to raise capital without issuing stock or dipping into its Bitcoin holdings.
The company stated, “The Company intends to continue issuing bonds under the Program in light of market conditions and other factors and, over the medium to long term, as the scale of issuance expands, to put in place the arrangements necessary to enable public bond offerings made under a securities registration statement or similar filing.”
Metaplanet is also expanding beyond Bitcoin accumulation, establishing Metaplanet Ventures in March 2026, and pledging 4 billion yen ($25 million) over two years toward Bitcoin and crypto infrastructure in Japan.
Metaplanet Posts 3.33 Billion Yen Operating Profit
Metaplanet published its revenue numbers for the first half of 2026 on Thursday, reporting 4.94 billion yen ($33 million) in first-half revenue, a 134% increase year-over-year. It also reported a 3.33 billion yen ($20.3 million) operating profit, up 136%, while reporting a 182.8 billion yen net loss ($1.2 billion), driven by a non-cash Bitcoin valuation loss. Metaplanet noted that it sold no Bitcoin in 2026 and added 7,898 BTC during H1 2026, taking its holdings to 43,000 BTC.
The company reported 4.7 billion yen in revenue from its Bitcoin income business and a 4.2 billion yen profit. The majority of this revenue came from Bitcoin derivatives trading, with option premium income accounting for 4.5 billion yen.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
Bitcoin moved lower into Friday’s Wall Street open, with traders increasingly focused on whether the market is setting up for a renewed downside break. While broader risk assets managed to hold momentum after encouraging US inflation developments, BTC failed to participate, slipping toward month-to-date lows around the low-$62,000s.
Market attention has now shifted to the next major US macro release: the Aug. 26 Personal Consumption Expenditures (PCE) index, which is the Federal Reserve’s preferred inflation gauge. QCP Capital said the crypto sector’s muted response to softer inflation so far makes the upcoming PCE print especially important for what comes next.
Key takeaways
- BTC is trading below $63,000 and is nearing new August lows, despite US equities hitting record highs.
- Rekt Capital highlighted $63,220 as a weekly-close threshold, warning that staying below it could encourage a deeper breakdown.
- TradingView data showed BTC down about 1.3% on the day to roughly $62,570, near month-to-date lows.
- QCP Capital pointed to the upcoming Aug. 26 PCE release as the next critical test for whether macro tailwinds can translate into sustained crypto demand.
BTC underperforms as stocks press to new highs
According to TradingView, BTC/USD was down about 1.3% on the day to $62,570, trading close to its lowest levels month-to-date. This comes as US stocks continued to climb, with the S&P 500 and the Nasdaq Composite both posting gains by the time of writing on Thursday’s close—an environment that has typically supported risk-on assets.
The divergence matters because it suggests Bitcoin is not simply tracking the improving equity tape. Earlier coverage noted that inflation relief in the US had reduced expectations for further interest-rate pressure, but Bitcoin still lacked the follow-through traders often look for when macro conditions improve.
$63,220 on weekly close as a decision point
One of the clearest near-term signposts is $63,220. Trader and analyst Rekt Capital warned that the Sunday weekly close needs to be above that level to avoid setting up what he described as “a breakdown.” In a post on X, Rekt Capital also stressed that $63,000 is no longer behaving like reliable support after weakening throughout August.
Rekt Capital further tied the current structure to prior market behavior, noting that a 50-month exponential moving average (EMA) near $65,827 appears to be acting as resistance. He framed this as reminiscent of the 2022 bear-market pattern, emphasizing that BTC has recently struggled to reclaim key levels that would normally help stabilize price action.
For traders, the practical implication is straightforward: the market is approaching a level where confirmation could shift from “range behavior” to “trend continuation lower” if price fails to regain momentum on the weekly timeframe.
Derivatives positioning and liquidation risk remain in focus
The caution around a potential breakdown has also been linked to positioning in derivatives markets. Earlier coverage from Cointelegraph reported increasing odds of a liquidation event as BTC approached an area of liquidity around $61,000, alongside rising open interest (OI) in futures and other derivatives venues.
That setup can amplify volatility when price breaks downward, particularly when leverage is concentrated on one side of the market. In a recent edition of its newsletter, onchain analytics platform Glassnode summarized the broader imbalance: “Traders have added substantial risk, most of it long, into a market that shows no matching demand,” according to The Week Onchain.
In this context, the market’s inability to rally alongside stocks becomes even more notable—if demand doesn’t show up when price is supported by the macro narrative, leveraged long positioning can become vulnerable quickly when technical levels fail.
PCE on Aug. 26 becomes the next macro catalyst
Beyond technical levels, QCP Capital argued that the crypto market’s response to improved inflation conditions has been inconsistent. In its latest analysis, QCP said the phenomenon is “increasingly important,” distinguishing between “resilience” and “momentum.” The firm noted that BTC absorbed several negative headlines without a sustained breakdown last week, but that softer inflation data have only produced a muted response so far.
QCP’s key point for investors is that the market may be waiting for a more decisive macro signal rather than reacting to incremental improvements. The firm said macro traders are now focused on the Aug. 26 PCE index release—widely recognized as the Federal Reserve’s preferred inflation gauge.
According to data referenced by QCP, the PCE “last print” in July marked its first monthly decline since 2020, based on figures from the Bureau of Economic Analysis. That makes the upcoming reading notable: if the data reinforces a cooling inflation trend, traders may look for whether crypto can finally convert the narrative into sustained buying demand rather than staying range-bound or weakening.
At the same time, the key uncertainty is timing and translation. So far, the pattern described by QCP suggests that macro relief hasn’t yet been strong enough to move crypto into a clear uptrend. With BTC sitting below key technical thresholds, the PCE release could influence whether leveraged traders choose to reduce risk or add exposure—potentially affecting volatility regardless of the direction of inflation prints.
Heading into the Aug. 26 PCE report, traders will likely watch both the weekly technical level near $63,220 and whether derivatives positioning continues to build risk on the long side. If BTC remains unable to reclaim that threshold, the market may be setting up for sharper downside moves; if it does recover, investors will want to see whether the macro narrative finally produces sustained momentum rather than a brief relief rally.
JPMorgan Chase (JPM) continues to grind higher, ranks first in Investor’s Business Daily’s Banks-Money Center group and was just added to IBD’s Big Cap 20 list. So traders might consider taking some bullish exposure on JPMorgan stock, using options in a limited risk way. One way to do that is by using a bullish butterfly spread. This is a similar idea…
Copyright ©2026 Investor’s Business Daily, LLC. All rights reserved. 87990cbe856818d5eddac44c7b1cdeb8
Crypto World
AI cannot bear liability for losing trades, responsibility follows delegation: Brickken CEO
AI agents have started executing trades and moving funds without constant human approval, prompting Brickken CEO Edwin Mata to argue that liability must follow the authority granted to the software rather than attach to the AI itself.
Summary
- AI agents cannot assume legal duties because current law does not recognize them as legal persons.
- Mata said principals normally bear the outcome when agents act within an authorized mandate.
- ERC-8226 proposes time limits, financial caps, revocation controls, and verifiable records for AI agents.
- U.S. securities rules already require broker-dealers to control automated systems that access regulated markets.
Sandmark reported on Aug. 6 that existing laws provide no single answer for losses caused by autonomous financial agents, leaving courts to examine the user, developer, platform, and institution involved in each transaction.
The report said contract law, negligence rules, product liability, and fiduciary duties could all apply, depending on who controlled the agent and what caused the loss. A user may bear the result of an authorized trade, while a developer or platform could face claims if faulty design, weak safeguards, or corrupted information pushed the agent outside its intended role.
Commenting on the issue, Edwin Mata, a lawyer and the CEO and co-founder of tokenization platform Brickken, told crypto.news that responsibility should never be assigned directly to the software.
“Under current law, AI is not a legal person capable of assuming duties or bearing liability. It is a technical system acting on behalf of a natural or legal person.”
According to Mata, an investigation should instead establish who authorized the agent, whose interests it represented, and what powers it received. Such an inquiry would help distinguish a losing decision made within an approved strategy from a transaction that broke the agent’s limits.
AI agent liability follows the granted authority
Mata compared the legal relationship to a power of attorney, under which one party receives permission to act for another within a defined scope. When an issuer, bank, or investor authorizes an agent to transact, he said, the principal would ordinarily bear the consequences of actions that remain within that authority.
Under the same reasoning, an investor could not reject a trade simply because the software produced an unfavorable result. A price loss does not by itself show that the agent acted without permission or that another party failed in its duties.
“An issuer cannot disown an unfavourable but authorised transaction merely because the decision was generated by software,” Mata said.
Responsibility may change when an agent exceeds its mandate. Mata said a developer, platform, or financial institution could face exposure if its design or controls caused or allowed the failure, although the final assessment would depend on the facts and applicable law.
Sandmark cited similar legal distinctions in its report. Chanté Eliaszadeh, founder of Astraea Counsel, told the publication that liability would generally follow control. She said users are usually the starting point when agents act on their behalf, but developers could face risk if a system marketed for autonomous trading failed in a foreseeable way.
The question has gained urgency as agents obtain direct access to wallets and payment systems. In May, a Keyrock report found that AI agents had settled $73 million through 176 million transactions during the previous 12 months, with USDC accounting for 98.6% of the payments examined.
Coinbase has also connected agents to trading, portfolio management, and payments under user-set limits. By July, Chainalysis had counted more than 100 million x402-linked payments on Base, although the analytics firm said meme-coin farming and automated activity contributed to the early transaction totals. The figures therefore did not represent only independent agents buying goods or services.
Human approval needs clear and enforceable limits
While a person may formally approve an agent’s activity, Mata said consent alone does not provide meaningful control if the person cannot understand the authority being granted.
Effective delegation, in his view, requires a list of permitted actions and eligible assets, along with limits for individual transactions and total spending. A mandate should also specify its duration, the conditions requiring human review, the principal’s right to revoke access, and a record of every action taken.
Such controls are already appearing in commercial products. Anchorage Digital introduced agentic banking in May with verified identities, spending limits, and audit controls for autonomous systems accessing crypto and traditional payment rails.
Visa and Wirex have separately tested agent-led stablecoin payments for software subscriptions, marketing budgets, and procurement. According to Wirex, the trials were designed to examine security, reliability, transparency, and consumer control when software initiates payments for a user or business.
A June guide to agentic payments explained how x402 allows autonomous software to pay for data, computing services, and online resources using stablecoins. Because those payments can occur without a person approving each transaction, authorization systems must establish what the agent can buy, how much it can spend, and when its access ends.
ERC-8226 would record AI agent mandates onchain
Mata pointed to ERC-8226, the proposed Regulated Agent Mandate Standard, as one model for making delegated authority verifiable.
Filed as a draft Ethereum standard on April 12, ERC-8226 is designed for AI agents operating with tokenized regulated assets. The proposal was written by Brickken contributors Ludovico Rossi, Dario Lo Buglio, Thamer Dridi, and Nabil El Alami Khalifi.
Known as RAMS, the standard would let a verified principal give an onchain agent permission that is limited by asset, action, duration, and monetary value. A regulated token contract could check the mandate when the agent tries to execute a transaction.
The proposal separates three questions that may arise during an agent-led trade. An identity registry would confirm that the agent exists, a compliance provider would determine whether the principal is eligible to transact in the asset, and the RAMS registry would verify whether the planned action falls within the delegated mandate.
Under the draft specification, a mandate could set a maximum amount for one transaction and a cumulative amount across multiple transactions. It could also include activation and expiry times, allowed assets, approved actions, revocation functions, and records showing how much authority the agent has already used.
Mata said RAMS would not transfer liability to the agent or reimburse a principal for an authorized loss. Instead, the proposed standard would provide evidence showing who granted the authority, what the agent could do, and whether the transaction remained within those limits.
“Its purpose is to make attribution verifiable: who granted the authority, what the agent was permitted to do, whether it remained within those limits and which person or control failed when it did not.”
ERC-8226 remains a draft rather than an adopted Ethereum standard or legal requirement. Its discussion page also lists unresolved questions, including whether tokens purchased by an agent should remain in the agent’s wallet or settle directly into the principal’s wallet.
U.S. rules keep responsibility with regulated firms
For U.S. markets, existing securities rules already place duties on the firms that provide access to exchanges and alternative trading systems.
Under SEC Rule 15c3-5, a broker-dealer providing market access must maintain financial and regulatory risk controls under its direct and exclusive control, subject to limited exceptions. SEC guidance says the broker-dealer remains responsible for the effectiveness of those controls even when it uses technology supplied by an independent third party.
The rule requires automated pre-trade checks designed to stop orders that exceed preset credit or capital thresholds. It also requires controls that restrict trading systems to authorized people, block prohibited securities transactions, and deliver immediate execution reports to surveillance staff.
For consumer payments, Regulation E requires preauthorized electronic fund transfers to carry a written or similarly authenticated authorization from the account holder. CFPB guidance also says the authorization process should demonstrate the consumer’s identity and agreement, while allowing the consumer to stop or revoke future payments under specified procedures.
Current CFPB rules do not directly state how a standing instruction such as “manage my portfolio” should apply when an AI agent independently selects and executes individual transfers. Sandmark reported that lawyers remain divided over whether a manipulated agent payment would resemble an unauthorized transfer caused by stolen credentials or an authorized transaction carried out under previously granted access.
Outside the United States, Bank of England Deputy Governor Sarah Breeden said in June that financial oversight frameworks were not designed for autonomous agents and that requiring human approval for every action may be unrealistic. She said regulators were considering stronger safeguards, including circuit breakers or market-wide kill switches if faulty AI models threatened trading systems.
Lynq CEO Jerald David has said institutional finance needs interoperable settlement systems capable of moving cash and collateral 24/7 as firms adopt several forms of digital money.
Summary
- Institutions are likely to use stablecoins, tokenized deposits, CBDCs, and traditional bank money.
- Separate payment systems can leave capital unavailable where institutions need it.
- The Bank of England is testing stablecoins and simulated digital pounds in one payment flow.
- David said settlement infrastructure must keep pace with markets that trade around the clock.
In comments shared with crypto.news, David said the Bank of England’s latest digital pound experiment gives an early indication of how institutional markets may use several forms of digital money instead of choosing one option.
“I do not expect a single form of digital money to replace all others,” David said.
“Stablecoins, tokenized deposits, tokenized money market funds, potentially CBDCs, and traditional bank money are all likely to have different roles depending on the counterparty, jurisdiction, and type of transaction.”
His comments follow an Aug. 12 report detailing how NOBO Finance, Dun & Bradstreet, and Polygon Labs joined Phase 2 of the Bank of England’s Digital Pound Lab. The consortium is testing whether a stablecoin and simulated digital pounds can handle separate parts of the same cross-border trade-finance payment.
Under the test, an exporter receives an advance through a stablecoin payment system while a UK importer completes the final settlement in simulated digital pounds. Polygon Labs said both parts are coordinated within one transaction flow, allowing the experiment to study whether private and central bank money can operate together without one side waiting for the other.
Separate settlement rails can restrict institutional capital
Rather than treating the experiment as a contest between stablecoins and a central bank digital currency, David focused on the infrastructure connecting different forms of money. Institutions may have enough capital overall, he said, but the funds may not be available in the required form, market, or jurisdiction when a transaction must settle.
“The challenge arises when these different forms of money operate on separate rails. An institution may have sufficient capital available, but not necessarily in the right form or in the right place at the point it is needed.”
According to David, fragmented systems can create problems across funding, collateral management, and settlement. Firms may respond by placing funds in advance at several trading venues or with multiple counterparties, tying up capital that could otherwise remain available for other transactions.
The problem extends beyond converting one digital currency into another. A financial institution may hold bank deposits for regular business, stablecoins for blockchain transactions, and tokenized money market fund shares for managing short-term liquidity. Each instrument can serve a separate purpose, but David said institutions still need a way to move value between them when obligations arise.
Polygon described a similar problem when announcing its involvement in the Bank of England experiment. The company said bank money, stablecoins, tokenized deposits, and a possible digital pound currently operate through systems that do not communicate easily.
Polygon is supplying the stablecoin settlement component and related smart-contract infrastructure through its Open Money Stack. The simulated digital-pound portion remains on the Bank of England’s demonstration ledger rather than moving onto Polygon.
Why 24/7 trading requires continuous settlement
As digital asset markets trade without closing, David said the difference between trading hours and settlement hours has become more important for institutions. Crypto markets operate through nights, weekends, and public holidays, while bank transfers and parts of the traditional settlement system remain subject to operating schedules and daily cut-off times.
“If assets can trade around the clock but cash and collateral cannot move on the same basis, only part of the problem has been addressed,” David said.
An institution facing a margin call outside banking hours may own enough cash or liquid assets to meet its obligation. David’s argument, however, is that the capital offers limited help if the firm cannot transfer it to the required counterparty before traditional payment systems reopen.
Lynq encounters the mismatch in institutional digital asset markets, according to David. The company operates a broker-dealer-run settlement network intended for institutions that need to earn yield, transfer funds, and settle digital asset transactions.
“At Lynq, we encounter this mismatch directly in institutional digital asset markets,” he said. “The practical issue is not so much creating another form of digital money, but ensuring that capital can move to where it is required, at the time it is required.”
U.S. banks are also developing products intended to extend settlement beyond normal hours. An Aug. 4 report on Wells Fargo tokenized deposits said the bank plans to begin with selected corporate clients using a U.S. dollar-to-British pound corridor.
Wells Fargo said its planned service would allow participating clients to transfer, program, and settle funds around the clock on the bank’s blockchain platform. The initial release is expected to expand to additional clients, countries, and currencies during 2027.
Institutions are developing several forms of digital money
David’s expectation that different types of digital money will coexist is also visible in projects under development at major banks. Stablecoin issuers provide tokens backed by reserve assets, while tokenized deposits remain liabilities of the commercial banks that issue them.
During June, major U.S. banks backed plans for a shared tokenized-deposit network scheduled for 2027. The project involves JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo as banks seek to provide blockchain-based payments without moving customer deposits outside the banking system.
According to the participating institutions, a shared network could allow bank-issued digital money to move among participating lenders instead of remaining confined to one bank’s internal system. Such arrangements still require common technical, legal, and compliance standards before deposits issued by separate banks can work together.
Stablecoins provide another route by allowing tokens to move across blockchain networks and jurisdictions. However, David said the form an institution chooses may depend on the counterparty, applicable rules, and transaction type rather than one instrument proving suitable for every use.
Tokenized money market funds add a third option by placing shares in cash-management funds on blockchain systems. Institutions can use the products to hold assets that may earn a return, although transferring a fund share does not always provide the same function as transferring bank money or a payment stablecoin.
Central bank money would carry a different risk structure because a digital pound would represent a direct liability of the Bank of England. Commercial bank deposits remain claims on banks, while stablecoin holders depend on a private issuer and its reserve arrangements.
Bank of England tests a multi-money payment system
The Digital Pound Lab gives private firms access to a simulated environment containing application programming interfaces, wallets, a demonstration ledger, and separate smart-contract functions. According to the Bank of England, the lab uses no real customers or money and is not a regulatory sandbox.
NOBO Finance leads the consortium’s trade-finance design and a second workstream involving a portable credit profile for small businesses. Dun & Bradstreet contributes verified company identity and credit information, while Polygon supplies blockchain infrastructure intended to let the profile travel with the payment.
The trade-finance test uses invoice factoring backed by an electronic bill of lading. Under the proposed process, an exporter can obtain a stablecoin advance rather than waiting for the importer’s final payment, while the UK importer later settles the transaction with simulated digital pounds.
The Bank has not decided to issue a digital pound, and the participants’ designs do not indicate its eventual policy or the final structure of any CBDC. The Bank and HM Treasury are due to decide on the project’s next steps later in 2026, while any introduction of a digital pound would require Parliament to approve primary legislation.
Similar work is taking place at the international level. The Bank for International Settlements said its Project Agorá prototype showed that tokenized commercial bank deposits could settle against tokenized central bank reserves across jurisdictions. The project involves seven central banks and more than 40 financial institutions, with later trials expected to process transactions using real value.
For the Bank of England consortium, Phase 2 remains a controlled test rather than a live payment service. The Bank said participants develop their use cases over three months and share the results to inform its work on digital-pound technology, payment services, and possible business models for intermediaries.
ATI: Why I Am Downgrading This Strong Performer (NYSE:ATI)
StablecoinX holds 20% of ENA supply as shares jump 12%
Romeo’s Choice gets a 1400m opportunity at Rosehill in 2026
-
Fashion7 days agoWeekend Open Thread: Mattifying Sunscreen
-
News Videos6 days agoCan Astrology Help Find Gold and Silver Trends? A Financial Astrology Guide
-
Business5 days agoDatadog: Best Of Breed For Multiple Reasons
-
Tech7 days agoRinn Pharma & Biopharma to join NordicPharmaTrain network
-
Business6 days agoHow to Start a Cleaning Business: A Step-by-Step Guide
-
Business6 days agoBDC Weekly Review: Private BDC Q2 Numbers Are Strong
-
NewsBeat3 days agoCommunication cards help banking customers access services or report scams
-
Business4 days agoOil Price Today (August 11): Crude oil rises to $88 after Trump’s compensation demand dents Hormuz opening. Here’s why
-
Fashion7 days agoWeekly News Update, 8.6.26 – Corporette.com
-
Entertainment6 days ago10 R-Rated Drama Movies That Can Be Called Masterpieces
-
Fashion5 days agoAmazon Sundays: Closet Care Before Fall
-
Business6 days agoSharkNinja Keeps Eating
-
Politics6 days agoBe quiet, Miriam! – spiked
-
Business6 days agoMutual Fund Manager Scoops Up Beaten-Down Stocks
-
Politics5 days agoBen-Gvir’s crocodile project halted but abuses at Ketziot Prison continue
-
Business5 days ago5 Things You Must Know About Jorge Messi, the Father and Longtime Agent Who Shaped Lionel Messi’s Career
-
Entertainment7 days agoWarren Hudson’s Dad Releases Audio Of Threats
-
Politics7 days agoWelsh independence campaign group YesCymru sets 2032 referendum target
-
Politics5 days agoThe Church of England’s ruinous reparations racket
-
Crypto World4 days agoWhy Did Nvidia Stock Fall on Monday Despite a $500 Billion Wall Street AI Deal?
You must be logged in to post a comment Login